Does technological standardization enhance or inhibit firm's capabilities? Research on dynamic capabilities in the mobile communication market

Mobile communication market presents drastically technology changes from the first generation (1G), second generation (2G), third generation (3G) and next fourth generation(4G) in progress. It's also apparently characterized with the industry standardization, which specifies compatibility and interoperability of the product, with the objective of increasing the efficiency of economic activity. Standardization will convey direct competitive advantage to the owner of the technology. The standard-setting processes are resulted in one of the competitive platforms for expansion and development of a new market. It's interesting that the standards reflect competing and collaborating due to the disclosure and availability assurance of the patents which might be essential to the implementation standards (so-called “essential patents”). These essential patents simultaneously offer the opportunities to innovation and technology diffusion. We assume that firms will develop technological capabilities through the standards and essential patents. This paper studies the relationship between firm's dynamic capabilities and essential patents through each technology generation, thereby, eliciting implications for an optimal role for technological standards in the firm's capability deploying and exploring processes, taking mobile communications as an example.